The Migration Advisory Committee (MAC) was asked by the UK government to advise on the economic and social impact of the UK’s exit from the European Union (EU) and also on how the UK’s immigration system should be aligned with a modern industrial strategy.
The MAC’s findings and recommendations to the UK government will be based on evidence it receives from interested parties. Employer working groups, associations and bodies, such as the EEF, education organisations and individual employers and their advisers, have fed into the MAC’s review.
Dentons also gathered the views of its clients and compiled these into a report that was submitted to the MAC.
We received responses from all sizes of employers, with the largest contributors having more than 501 employees based in the UK, predominantly in England. Dentons was told by its clients that in most cases up to 25 per cent of their workforces were made up of EEA nationals (excluding UK nationals), despite making vacancies equally accessible to UK nationals. EEA nationals are citizens from the EU (i.e. Austria, Belgium, Bulgaria, Croatia, Republic of Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden and the UK) plus Iceland, Liechtenstein and Norway.
The sectors in which EEA workers were mainly employed or engaged were administrative and support services, financial and insurance activities, transportation and storage services, and software and telecoms/technology.
Respondents gave a variety of views on what they saw as the advantages of engaging EEA workers. These ranged from the high skills they brought, including language skills, the flexibility they provided, and, most notably the lack of bureaucracy or administration that was involved in recruiting them, when compared to recruiting migrants from outside the EEA under the UK’s points-based immigration system.
Workers were most often engaged for assignments of 24 months or longer. In most cases, these workers were highly skilled, working in roles that required degree, graduate diploma and postgraduate qualifications, or the equivalent. However, a large cohort was also noted as working in unskilled roles or those that required bilingual language skills.
Importantly, more than 80 per cent of respondents to Dentons’ survey said that they expected they would need to have the work currently undertaken by their EEA workforce (excluding UK nationals) carried out for the foreseeable future. It is therefore understandably a worrying time for these employers, who have no guarantee that their EEA workforce will be allowed to stay in the UK after Brexit, which currently is still set for 29 March 2019, just 16 months away. Not only were these employers concerned at the loss of their labour force but also nearly 70 per cent said that EEA nationals contributed to their organisation from a social and/or economic standpoint.
UK businesses are starting to consider strategies for coping without an EEA workforce after Brexit. Unsurprisingly, most respondents said that they would try to recruit British workers to carry out the jobs in question. Disappointingly, nearly a fifth of respondents will reduce the output of their business if EEA migration to the UK is substantially reduced. Other respondents are contemplating changing their products or services, relocating outside the UK or closing their UK operations altogether. Some of these changes have been imposed on businesses as a knock-on effect of customers already reducing or postponing purchasing decisions.
Next steps for the MAC
For now, the government continues to publish piecemeal information on what the UK’s immigration regime is expected to look like after Brexit. EEA nationals who have been living continuously in the UK for five years when the UK leaves the EU will be able to apply to stay indefinitely by getting ‘settled status’. Any other EEA nationals will find that either they fall into the category of being able to apply for temporary permission to stay before then becoming eligible for settled status or they will be subject to new immigration arrangements that will be put in place following the MAC’s report.
The MAC will produce its report, which will inform the government’s revised immigration policy, in March 2019. For some industries this is too late. A commitment is needed sooner so that businesses can plan ahead – for example, those whose produce is seasonal. Although no further formal submissions can be made to the MAC, we are likely to see a continuing lobby from certain sectors about their bespoke needs, in an attempt to influence the MAC’s conclusions and the government’s resulting policy decisions.
Verity Buckingham is senior associate at Dentons.